Health care overhaul lawsuit can proceed

COURTS

Melissa Nelson, Associated Press

Published
4:00 am PDT, Friday, October 15, 2010

Crucial pieces of a lawsuit challenging the Obama administration's health care overhaul can go to trial, with a judge ruling Thursday he wants to hear more arguments over whether it's constitutional to force citizens to buy health insurance.

In a written ruling, U.S. District Judge Roger Vinson said it also needs to be decided whether it's constitutional to penalize people who do not buy insurance with taxes and to require states to expand their Medicaid programs. Another federal judge in Michigan threw out a similar lawsuit last week.

Vinson set a hearing for Dec. 16. The lawsuits will probably wind up before the Supreme Court.

In his 65-page ruling, Vinson largely agreed with the 20 states and the National Federation of Independent Business, saying Congress was intentionally unclear when it created penalties in the legislation. The states have argued that Congress is overstepping its constitutional authority by penalizing people for not doing something - not buying health insurance.

The penalties for those who do not buy insurance are never referred to as taxes in the 2,700-page act, Vinson wrote. Attorneys for the Obama administration argued at a September hearing that the penalties should be considered a tax levied by Congress - as allowed by its constitutional power to regulate interstate commerce.

The administration's attorneys had told Vinson last month that without the regulatory power to ensure young and healthy people buy health insurance, the health care plan will not survive.

Vinson also took issue with the administration's argument that the states and individual taxpayers must wait until 2014, when some of the changes take effect, to file any lawsuits. Vinson said businesses and states are feeling the ramifications of the law now.

The health care act leaves states with the difficult choice of expanding their Medicaid programs and taking on major expenses or entirely withdrawing from the insurance program for the poor, Vinson wrote.

Vinson's ruling comes a week after District Judge George Caram Steeh in Detroit ruled that the mandate to get insurance by 2014 and the financial penalty for skipping coverage are legal. There is also a lawsuit pending in Virginia, where a federal judge has allowed the lawsuit to continue.